BENGALURU (Reuters) -An Indian spacecraft landed on the rugged, unexplored south pole of the moon on Wednesday in a mission seen as crucial to lunar exploration and India's standing as a space power, just days after a similar Russian lander crashed.

"This moment is unforgettable. It is phenomenal. This is a victory cry of a new India," said Prime Minister Narendra Modi, who waved the Indian flag as he watched the landing from South Africa where he is attending a regional summit.

Scientists and officials clapped, cheered and hugged each other as the spacecraft landed and people across India broke out in celebration, setting off firecrackers and dancing in the streets.

"India is on the moon," said S. Somanath, chief of the Indian Space Research Organisation (ISRO) as the Chandrayaan-3 spacecraft landed.

This was India's second attempt to land a spacecraft on the moon and comes less than a week after Russia's Luna-25 mission failed. People across the country were glued to television screens and said prayers as the spacecraft approached the surface.

Nearly 7 million watched the YouTube live stream.

Chandrayaan means "moon vehicle" in Hindi and Sanskrit. In 2019, ISRO's Chandrayaan-2 mission successfully deployed an orbiter but its lander crashed.

The Chandrayaan-3 is expected to remain functional for two weeks, running a series of experiments including a spectrometer analysis of the mineral composition of the lunar surface.

The moon rover will take a few hours or a day to come out of the spacecraft, Somanath told reporters, adding that the landing has given India confidence to extend its reach to possible voyages to Mars and Venus.

The landing is expected to boost India's reputation for cost-competitive space engineering. The Chandrayaan-3 was launched with a budget of about 6.15 billion rupees ($74 million), less than the cost to produce the 2013 Hollywood space thriller "Gravity".

Rough terrain makes a south pole landing difficult, and a first landing is historic. The region's ice could supply fuel, oxygen and drinking water for future missions.

"Landing on the south pole would actually allow India to explore if there is water ice on the moon. And this is very important for cumulative data and science on the geology of the moon," said Carla Filotico, a partner and managing director at consultancy SpaceTec Partners.

Anticipation before the landing was feverish, with banner headlines across Indian newspapers and news channels running countdowns to the landing.

Prayers were held at places of worship across the country, and school children waved the Indian tricolour as they waited for live screenings of the landing.

Children gathered on the banks of the Ganga river, considered holy by Hindus, to pray for a safe landing, and mosques in several places offered prayers.

At a Sikh temple, known as a gurduwara, in the capital New Delhi, Petroleum Minister Hardeep Singh Puri also offered prayers for Chandrayaan.

"Not just economic, but India is achieving scientific and technological progress as well," Puri told reporters.

India is also planning to launch a mission in September to study the sun, Somanath said. A human space flight is also planned and, while no official date has been announced, preparations are likely to be ready by 2024.

(Reporting by Nivedita Bhattacharjee in Bengaluru; additional reporting by Sunil Kataria, Krishn Kaushik; Writing by Shilpa Jamkhandikar and Shivam Patel, Editing by Gerry Doyle, Angus MacSwan and Nick Macfie)